10-Q 1 vishayintertech_10q.htm QUARTERLY REPORT
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended           October 1, 2022

☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission File Number 011-07416

Vishay Intertechnology, Inc.
(Exact name of registrant as specified in its charter)

Delaware  
38-1686453
(State or Other Jurisdiction of Incorporation)
  
(I.R.S. Employer Identification Number)
     
63 Lancaster Avenue
Malvern, Pennsylvania 19355-2143
  
610-644-1300
(Address of Principal Executive Offices)
  
(Registrant’s Area Code and Telephone Number)

Securities registered pursuant to Section 12(b) of the Act:
       
 
Title of each class
Trading symbol
Name of exchange on which registered
  
  Common stock, par value $0.10 per share VSH New York Stock Exchange LLC  

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes  ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files.)
☒Yes  ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 
Large Accelerated Filer ☒
Accelerated filer ☐
 
Non-accelerated filer ☐
Smaller reporting company ☐
 
Emerging growth company ☐
  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
☐ Yes  ☒ No

As of October 31, 2022 the registrant had 129,567,743 shares of its common stock (excluding treasury shares) and 12,097,148 shares of its Class B common stock outstanding.





















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2
VISHAY INTERTECHNOLOGY, INC.
FORM 10-Q
October 1, 2022
CONTENTS

     
Page Number
   
         
     
         
     
         
     
         
     
         
     
         
     
         
     
         
     
         
     
         
   
         
   
         
   
         
   
         
   
         
   
         
   
         
   
         
   
         
   
         
   
         
     
3

PART I  - FINANCIAL INFORMATION

Item 1. Financial Statements

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets
(In thousands)

   
October 1, 2022
    
December 31, 2021
  
   
(Unaudited)
        
Assets
            
Current assets:
            
Cash and cash equivalents
  
$
734,992
    
$
774,108
  
Short-term investments
    
182,646
      
146,743
  
Accounts receivable, net
    
425,630
      
396,458
  
Inventories:
                
Finished goods
    
164,252
      
147,293
  
Work in process
    
252,492
      
226,496
  
Raw materials
    
199,133
      
162,711
  
Total inventories
    
615,877
      
536,500
  
                 
Prepaid expenses and other current assets
    
151,144
      
156,689
  
Total current assets
    
2,110,289
      
2,010,498
  
                 
Property and equipment, at cost:
                
Land
    
74,118
      
74,646
  
Buildings and improvements
    
617,784
      
639,879
  
Machinery and equipment
    
2,743,049
      
2,758,262
  
Construction in progress
    
167,336
      
145,828
  
Allowance for depreciation
    
(2,613,506
)
    
(2,639,136
)
Property and equipment, net
    
988,781
      
979,479
  
                 
Right of use assets
    
118,676
      
117,635
  
                 
Deferred income taxes
     85,288       95,037  
                 
Goodwill
    
163,567
      
165,269
  
                 
Other intangible assets, net
    
59,918
      
67,714
  
                 
Other assets
    
94,027
      
107,625
  
Total assets
  
$
3,620,546
    
$
3,543,257
  

Continues on following page.
4

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Balance Sheets (continued)
(In thousands)

   
October 1, 2022
    
December 31, 2021
  
   
(Unaudited)
        
Liabilities and equity
            
Current liabilities:
            
Trade accounts payable
  
$
223,898
    
$
254,049
  
Payroll and related expenses
    
164,303
      
162,694
  
Lease liabilities
    
23,650
      
23,392
  
Other accrued expenses
    
220,542
      
218,089
  
Income taxes
    
84,571
      
35,443
  
Total current liabilities
    
716,964
      
693,667
  
                 
Long-term debt less current portion
    
458,120
      
455,666
  
U.S. transition tax payable
    
83,010
      
110,681
  
Deferred income taxes
    
52,382
      
69,003
  
Long-term lease liabilities
    
95,747
      
99,987
  
Other liabilities
    
84,575
      
95,861
  
Accrued pension and other postretirement costs
    
229,467
      
271,672
  
Total liabilities
    
1,720,265
      
1,796,537
  
                 
Equity:
                
Vishay stockholders' equity
                
Common stock
    
13,291
      
13,271
  
Class B convertible common stock
    
1,210
      
1,210
  
Capital in excess of par value
    
1,351,470
      
1,347,830
  
Retained earnings
    
714,588
      
401,694
  
   Treasury stock (at cost)
     (54,671 )     -  
Accumulated other comprehensive income (loss)
    
(129,093
)
    
(20,252
)
Total Vishay stockholders' equity
    
1,896,795
      
1,743,753
  
Noncontrolling interests
    
3,486
      
2,967
  
Total equity
    
1,900,281
      
1,746,720
  
Total liabilities and equity
  
$
3,620,546
    
$
3,543,257
  

See accompanying notes.
5

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Operations
(Unaudited - In thousands, except per share amounts)

   
Fiscal quarters ended
  
   
October 1, 2022
    
October 2, 2021
  
             
Net revenues
  
$
924,798
    
$
813,663
  
Costs of products sold
    
635,260
      
587,927
  
Gross profit
    
289,538
      
225,736
  
                 
Selling, general, and administrative expenses
    
106,436
      
102,215
  
Operating income
    
183,102
      
123,521
  
                 
Other income (expense):
                
Interest expense
    
(4,110
)
    
(4,427
)
Other
    
2,137
   
(2,679
)
Total other income (expense)
    
(1,973
)
    
(7,106
)
                 
Income before taxes
    
181,129
      
116,415
  
                 
Income tax expense
    
40,566
      
19,333
  
                 
Net earnings
    
140,563
      
97,082
  
                 
Less: net earnings attributable to noncontrolling interests
    
502
      
262
  
                 
Net earnings attributable to Vishay stockholders
  
$
140,061
    
$
96,820
  
                 
Basic earnings per share attributable to Vishay stockholders
  
$
0.98
    
$
0.67
  
                 
Diluted earnings per share attributable to Vishay stockholders
  
$
0.98
    
$
0.67
  
                 
Weighted average shares outstanding - basic
    
142,887
      
145,017
  
                 
Weighted average shares outstanding - diluted
    
143,447
      
145,458
  
                 
Cash dividends per share
  
$
0.100
    
$
0.095
  

See accompanying notes.
6

VISHAY INTERTECHNOLOGY, INC.
Consolidated Statements of Comprehensive Income
(Unaudited - In thousands)

   
Fiscal quarters ended
  
   
October 1, 2022
    
October 2, 2021
  
             
Net earnings
  
$
140,563
    
$
97,082
  
                 
Other comprehensive income (loss), net of tax
                
                 
Pension and other  post-retirement actuarial items
    
1,321
      
1,850
  
                 
Foreign currency translation adjustment
    
(50,070
)
    
(17,242
)
                 
Other comprehensive income (loss)
    
(48,749
)
    
(15,392
)
                 
Comprehensive income
    
91,814
      
81,690
  
                 
Less: comprehensive income attributable to noncontrolling interests
    
502
      
262
  
                 
Comprehensive income attributable to Vishay stockholders
  
$
91,312
    
$
81,428
  

See accompanying notes.
7

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Operations
(Unaudited - In thousands, except per share amounts)

   
Nine fiscal months ended
  
   
October 1, 2022
    
October 2, 2021
  
             
Net revenues
  
$
2,642,103
    
$
2,397,415
  
Costs of products sold
    
1,832,234
      
1,739,458
  
Gross profit
    
809,869
      
657,957
  
                 
Selling, general, and administrative expenses
    
329,691
      
311,800
  
Operating income
    
480,178
      
346,157
  
                 
Other income (expense):
                
Interest expense
    
(12,639
)
    
(13,246
)
Other
    
(2,234
)
    
(12,159
)
Total other income (expense)
    
(14,873
)
    
(25,405
)
                 
Income before taxes
    
465,305
      
320,752
  
                 
Income tax expense
    
108,023
      
58,646
  
                 
Net earnings
    
357,282
      
262,106
  
                 
Less: net earnings attributable to noncontrolling interests
    
1,260
      
659
  
                 
Net earnings attributable to Vishay stockholders
  
$
356,022
    
$
261,447
  
                 
Basic earnings per share attributable to Vishay stockholders
  
$
2.47
    
$
1.80
  
                 
Diluted earnings per share attributable to Vishay stockholders
  
$
2.46
    
$
1.80
  
                 
Weighted average shares outstanding - basic
    
143,983
      
145,000
  
                 
Weighted average shares outstanding - diluted
    
144,470
      
145,455
  
                 
Cash dividends per share
  
$
0.300
    
$
0.285
  

See accompanying notes.

8

VISHAY INTERTECHNOLOGY, INC.
Consolidated Statements of Comprehensive Income
(Unaudited - In thousands)

   
Nine fiscal months ended
  
   
October 1, 2022
    
October 2, 2021
  
             
Net earnings
  
$
357,282
    
$
262,106
  
                 
Other comprehensive income (loss), net of tax
                
                 
Pension and other post-retirement actuarial items
    
4,245
      
5,734
  
                 
Foreign currency translation adjustment
    
(113,086
)
    
(34,906
)
                 
Other comprehensive income (loss)
    
(108,841
)
    
(29,172
)
                 
Comprehensive income
    
248,441
      
232,934
  
                 
Less: comprehensive income attributable to noncontrolling interests
    
1,260
      
659
  
                 
Comprehensive income attributable to Vishay stockholders
  
$
247,181
    
$
232,275
  

See accompanying notes.
9

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Cash Flows
(Unaudited - In thousands)

   
Nine fiscal months ended
  
   
October 1, 2022
    
October 2, 2021
  
             
Operating activities
            
Net earnings
  
$
357,282
    
$
262,106
  
Adjustments to reconcile net earnings to net cash provided by operating activities:
                
Depreciation and amortization
    
121,301
      
125,095
  
(Gain) loss on disposal of property and equipment
    
(372
)
    
(254
)
Inventory write-offs for obsolescence
    
18,197
      
14,960
  
Deferred income taxes
    
8,843
      
(4,208
)
Other
    
4,272
      
8,376
  
  Change in U.S. transition tax liability
     (14,757 )     (14,757 )
  Change in repatriation tax liability
     (25,201 )     -  
Net change in operating assets and liabilities
    
(151,773
)
    
(80,866
)
Net cash provided by operating activities
    
317,792
      
310,452
  
                 
Investing activities
                
Capital expenditures
    
(172,175
)
    
(118,156
)
Proceeds from sale of property and equipment
    
472
      
1,257
  
Purchase of short-term investments
    
(182,079
)
    
(55,491
)
Maturity of short-term investments
    
132,892
      
126,171
  
Other investing activities
    
(199
)
    
347
  
Net cash used in investing activities
    
(221,089
)
    
(45,872
)
                 
Financing activities
                
Repurchase of convertible debt instruments
    
-
      
(300
)
Dividends paid to common stockholders
    
(39,433
)
    
(37,823
)
Dividends paid to Class B common stockholders
    
(3,629
)
    
(3,448
)
Repurchase of common stock held in treasury
     (54,671 )     -
  
Distributions to noncontrolling interests
     (741 )     (800 )
Cash withholding taxes paid when shares withheld for vested equity awards
    
(2,123
)
    
(1,963
)
Net cash used in financing activities
    
(100,597
)
    
(44,334
)
Effect of exchange rate changes on cash and cash equivalents
    
(35,222
)
    
(8,360
)
                 
Net increase (decrease) in cash and cash equivalents
    
(39,116
)
    
211,886
  
                 
Cash and cash equivalents at beginning of period
    
774,108
      
619,874
  
Cash and cash equivalents at end of period
  
$
734,992
    
$
831,760
  

See accompanying notes.
10

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Equity
(Unaudited - In thousands, except share and per share amounts)

   
Common
Stock
    
Class B
Convertible
Common
Stock
    
Capital in
Excess of Par
Value
    
Retained
Earnings
(Accumulated
Deficit)
    
Accumulated
Other
Comprehensive
Income (Loss)
    
Total Vishay
Stockholders'
Equity
    
Noncontrolling
Interests
    
Total
Equity
  
Balance at December 31, 2020
  
$
13,256
    
$
1,210
    
$
1,409,200
    
$
138,990
    
$
13,559
 
$
1,576,215
    
$
2,800
    
$
1,579,015
  
Cumulative effect of accounting change for adoption of ASU 2020-06
    
-
      
-
      
(66,078)
      
20,566
   
-
      
(45,512
)
    
-
      
(45,512
)
Net earnings
    
-
      
-
      
-
      
71,435
      
-
      
71,435
      
208
      
71,643
  
Other comprehensive income (loss)
    
-
      
-
      
-
      
-
      
(25,085
)
    
(25,085
)
    
-
      
(25,085
)
Issuance of stock and related tax withholdings for vested restricted stock units (149,722 shares)
    
15
      
-
      
(1,978
)
    
-
      
-
      
(1,963
)
    
-
      
(1,963
)
Dividends declared ($0.095 per share)
    
-
      
-
      
20
      
(13,777
)
    
-
      
(13,757
)
    
-
      
(13,757
)
Stock compensation expense
    
-
      
-
      
4,120
      
-
      
-
      
4,120
      
-
      
4,120
  
Balance at April 3, 2021
  
$
13,271
    
$
1,210
    
$
1,345,284
    
$
217,214
    
$
(11,526
)
  
$
1,565,453
    
$
3,008
    
$
1,568,461
  
Net earnings
    
-
      
-
      
-
      
93,192
      
-
      
93,192
      
189
      
93,381
  
Other comprehensive income
    
-
      
-
      
-
      
-
      
11,305
      
11,305
      
-
      
11,305
  
Distributions to noncontrolling interests
    
-
      
-
      
-
      
-
      
-
      
-
      
(800
)
    
(800
)
Dividends declared ($0.095 per share)
    
-
      
-
      
20
      
(13,777
)
    
-
      
(13,757
)
    
-
      
(13,757
)
Stock compensation expense
    
-
      
-
      
828
      
-
      
-
      
828
      
-
      
828
  
Balance at July 3, 2021
  
$
13,271
    
$
1,210
    
$
1,346,132
    
$
296,629
    
$
(221
)
  
$
1,657,021
    
$
2,397
    
$
1,659,418
  
Net earnings
    
-
      
-
      
-
      
96,820
      
-
      
96,820
      
262
      
97,082
  
Other comprehensive income (loss)
    
-
      
-
      
-
      
-
      
(15,392)
      
(15,392)
      
-
      
(15,392)
  
Dividends declared ($0.095 per share)
    
-
      
-
      
20
      
(13,777
)
    
-
      
(13,757
)
    
-
      
(13,757
)
Stock compensation expense
    
-
      
-
      
828
      
-
      
-
      
828
      
-
      
828
  
Balance at October 2, 2021
  
$
13,271
    
$
1,210
    
$
1,346,980
    
$
379,672
    
$
(15,613
)
  
$
1,725,520
    
$
2,659
    
$
1,728,179
  

 Continues on following page.
11

VISHAY INTERTECHNOLOGY, INC.
Consolidated Condensed Statements of Equity (continued)
(Unaudited - In thousands, except share and per share amounts)

   
Common
Stock
    
Class B
Convertible
Common
Stock
    
Capital in
Excess of Par
Value
    
Retained
Earnings
(Accumulated
Deficit)
     Treasury Stock
    
Accumulated
Other
Comprehensive
Income (Loss)
    
Total Vishay
Stockholders'
Equity
    
Noncontrolling
Interests
    
Total
Equity
  
Balance at December 31, 2021
  
$
13,271
    
$
1,210
    
$
1,347,830
    
$
401,694
     $ -    
$
(20,252
)
  
$
1,743,753
    
$
2,967
    
$
1,746,720
  
Net earnings
    
-
      
-
      
-
      
103,573
       -      
-
      
103,573
      
377
      
103,950
  
Other comprehensive income (loss)
    
-
      
-
      
-
      
-
       -      
(11,925
)
    
(11,925
)
    
-
      
(11,925
)
Issuance of stock and related tax withholdings for vested restricted stock units (189,731 shares)
    
19
      
-
      
(2,142
)
    
-
       -      
-
      
(2,123
)
    
-
      
(2,123
)
Dividends declared ($0.10 per share)
    
-
      
-
      
22
      
(14,491
)
     -      
-
      
(14,469
)
    
-
      
(14,469
)
Stock compensation expense
    
-
      
-
      
3,842
      
-
       -      
-
      
3,842
      
-
      
3,842
  
Repurchase of common stock held in treasury (513,227 shares)
     -       -       -       -       (9,873 )     -       (9,873 )     -       (9,873 )
Balance at April 2, 2022
   $ 13,290       1,210       1,349,552       490,776       (9,873 )     (32,177 )     1,812,778       3,344       1,816,122  
Net earnings
     -       -       -       112,388       -       -       112,388       381       112,769  
Other comprehensive income (loss)
     -       -       -       -       -       (48,167 )     (48,167 )     -       (48,167 )
Distributions to noncontrolling interests
     -       -       -       -       -       -       -       (733 )     (733 )
Issuance of stock and related tax withholdings for vested restricted stock units (11,308 shares)     1       -       (1 )     -       -       -       -       -       -  
Dividends declared ($0.10 per share)
     -       -       22       (14,361 )     -       -       (14,339 )     -       (14,339 )
Stock compensation expense
     -       -       1,047       -       -       -       1,047       -       1,047  
Repurchase of common stock held in treasury (1,400,039 shares)     -       -       -       -       (26,288 )     -       (26,288 )     -       (26,288 )
Balance at July 2, 2022   $ 13,291       1,210       1,350,620       588,803       (36,161 )     (80,344 )     1,837,419       2,992       1,840,411  
Net earnings
     -       -       -       140,061       -       -       140,061       502       140,563  
Other comprehensive income (loss)
     -       -       -       -       -       (48,749 )     (48,749 )     -       (48,749 )
Distributions to noncontrolling interests
     -       -       -       -       -       -       -       (8 )     (8 )
Dividends declared ($0.10 per share)
     -       -       22       (14,276 )     -       -       (14,254 )     -       (14,254 )
Stock compensation expense
     -       -       828       -       -       -       828       -       828  
Repurchase of common stock held in treasury (978,338 shares)     -       -       -       -       (18,510 )     -       (18,510 )     -       (18,510 )
Balance at October 1, 2022
   $ 13,291       1,210       1,351,470       714,588       (54,671 )     (129,093 )     1,896,795       3,486       1,900,281  

See accompanying notes.
12
NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)

Note 1 – Basis of Presentation

The accompanying unaudited consolidated condensed financial statements of Vishay Intertechnology, Inc. (“Vishay” or the “Company”) have been prepared in accordance with the instructions to Form 10-Q and therefore do not include all information and footnotes necessary for presentation of financial position, results of operations, and cash flows required by accounting principles generally accepted in the United States (“GAAP”) for complete financial statements. The information furnished reflects all normal recurring adjustments which are, in the opinion of management, necessary for a fair summary of the financial position, results of operations, and cash flows for the interim periods presented.  The financial statements should be read in conjunction with the consolidated financial statements filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.  The results of operations for the fiscal quarter and nine fiscal months ended October 1, 2022 are not necessarily indicative of the results to be expected for the full year.

The Company reports interim financial information for 13-week periods beginning on a Sunday and ending on a Saturday, except for the first fiscal quarter, which always begins on January 1, and the fourth fiscal quarter, which always ends on December 31.  The four fiscal quarters in 2022 end on April 2, 2022, July 2, 2022, October 1, 2022, and December 31, 2022, respectively.  The four fiscal quarters in 2021 ended on April 3, 2021, July 3, 2021, October 2, 2021, and December 31, 2021, respectively. 

Reclassifications

Certain prior period amounts have been reclassified to conform to the current financial statement presentation.

Note 2 - Acquisition Activities

As part of its growth strategy, the Company seeks to expand through targeted acquisitions of other manufacturers of electronic components.  These acquisition targets include businesses that have established positions in major markets, reputations for product quality and reliability, and product lines with which the Company has substantial marketing and technical expertise.  It also includes certain businesses that possess technologies which the Company expects to further develop and commercialize.

Subsequent Event

On October 28, 2022, 2022, Vishay acquired MaxPower Semiconductor, Inc. ("MaxPower"), a San Jose, California-based fabless power semiconductor provider dedicated to delivering innovative and cost-effective technologies that optimize power management solutions.  MaxPower's proprietary device structures and process techniques provide leading edge silicon and silicon carbide ("SiC") MOSFET products.  Its SiC product development targets automotive and industrial applications.

Vishay paid cash of $50,000, net of cash acquired, at closing.  Related to the transaction, Vishay may also be required to make certain contingent payments of up to $57,500, which would be payable upon the achievement of certain technology milestones and the occurrence of certain non-operating events.  The purchase price for U.S. GAAP purposes will include the fair value, as of the acquisition date, of certain future contingent payments.  To the extent contingent payments are deemed compensatory in nature, such payments will be recognized as expense in future periods, and will thus not be included in the U.S. GAAP purchase price.

MaxPower will be incorporated into Vishay’s MOSFETs reportable segment, and the goodwill related to this acquisition will be included in the MOSFETs reporting unit for goodwill impairment testing. 

Note 3 – Impact of COVID-19 Pandemic

The Company's operations in the People's Republic of China, particularly in Shanghai, were impacted by COVID-19 government mandated shut-downs of the Company's facilities in the second fiscal quarter of 2022.  The Company incurred incremental costs separable from normal operations that are directly related to the shut-downs, primarily wages paid to manufacturing employees during the shut-downs, additional wages and hardship allowances for working during lockdown periods, and temporary housing for employees due to travel restrictions, which were partially offset by government subsidies.  The net impact of the costs and subsidies are reported as cost of products sold ($6,661) and selling, general, and administrative expenses of ($546) based on employee function on the consolidated condensed statement of operations for the nine fiscal months ended October 1, 2022.

13
NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(dollars in thousands, except per share amounts)

Note 4 – Leases

The net right of use assets and lease liabilities recognized on the consolidated condensed balance sheets for the Company's operating leases were as follows:

 
October 1, 2022
    
December 31, 2021
  
Right of use assets
            
Operating Leases
            
Buildings and improvements
  
$
114,620
    
$
112,951
  
Machinery and equipment
    
4,056
      
4,684
  
Total
  
$
118,676
    
$
117,635
  
Current lease liabilities
                
Operating Leases
                
Buildings and improvements
  
$
21,395
    
$
20,851
  
Machinery and equipment
    
2,255
      
2,541
  
Total
  
$
23,650
    
$
23,392
  
Long-term lease liabilities
                
Operating Leases
                
Buildings and improvements
  
$
94,023
    
$
97,890
  
Machinery and equipment
    
1,724
      
2,097
  
Total
  
$
95,747
    
$
99,987
  
Total lease liabilities
  
$
119,397
    
$
123,379
  

Lease expense is classified in the statements of operations based on asset use.  Total lease cost recognized on the consolidated condensed statements of operations is as follows:

 
Fiscal quarters ended
    
Nine fiscal months ended
  
   
October 1, 2022
    
October 2, 2021
    
October 1, 2022
    
October 2, 2021
  
Lease expense
                        
Operating lease expense
  
$
6,258